Morrison to hold pension age at 67

VideoPrime Minister Scott Morrison has abandoned a commitment to raise the retirement age to 70

Prime Minister Scott Morrison’s decision to ditch plans to lift the aged pension age from 67 to 70 has been cautiously welcomed by seniors’ groups.

Mr Morrison revealed the move on morning television yesterday, saying it would be put to Cabinet next week for approval.

While the decision was criticised by economists, who say it would put pressure on the Budget as Australia ages, it was welcomed by seniors’ groups, who say it would ease pressure on those older Australians thrown on the unemployment scrapheap towards the end of their working life.

Council on the Ageing Australia chief executive Ian Yates said forcing older workers to remain on Newstart for another three years was not “fair or sensible” when companies were reluctant to employ older Australians.

“There is no point in raising the pension age further when people who want to work longer are too often locked out of even being considered for jobs because of persistent ageism and age discrimination,” he said.

Mr Yates said the Federal Government should focus on finding more ways to help older Australians get work.

“Lifting workforce participation will contribute much more money to the Federal Budget than raising the pension age further could ever save and it will result in better retirement incomes for many retirees, again saving the Budget,” he said.

Although Mr Morrison has adopted Labor’s position on aged-care eligibility, Opposition Leader Bill Shorten said he did not believe the backflip would survive if Mr Morrison won the next Federal election.

“Scott Morrison wrote the last three Budgets,” Mr Shorten said. “In every one of those last three Budgets he wanted to increase the retirement age to the age of 70.

“And I think most Australians know that if Scott Morrison wins the next election, if he gets control of the Senate, then the world’s oldest retirement age is back on the table.”

The proposal, which would have made Australia’s pension age one of the oldest in the developed world — surpassing the US, Britain, Canada and New Zealand — was introduced in the 2014 Budget and was set to add billions in savings to the bottom line over the next decade.

It is one of several so-called “zombie” measures held over from Tony Abbott’s second Budget as prime minister.

Mr Morrison had previously defended the policy, arguing it was necessary to protect the national Budget in the long term. It was due to be phased in from 2025, and Labor — which opposed the move — had said it would cut about $5 billion from pension payments over the medium term.

Mr Morrison said yesterday that the implications of the policy shift would be included in the midyear Budget review.